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Swine flu: it’s a goldmine for drug companies
But the plan to donate free vaccine to poorer countries has caused a split among the pharmaceutical giants
Swine flu may be an increasing worry for the British public and the government, which today launches its online self-diagnosis programme in an effort to relieve the pressure on GPs. But for the pharmaceutical giants, it's a potential goldmine. The British company GlaxoSmithKline (GSK) stands to make more than £1.5bn profit this year because of the pandemic threat.
Much of this will come from the delivery of 195m doses of vaccine ordered by various governments, including 60m for Britain, once human trials have deemed it safe to administer.
The vaccine is designed to prevent people contracting the virus. But GSK is also the manufacturer of the anti-viral treatment Relenza, which like Tamiflu is being used to relieve symptoms in those already suffering. GSK is raising its production of Relenza to 190m doses a year.
On top of that, GSK has developed an anti-viral face mask, for which the NHS and other authorities are expected to place thousands of orders for use by doctors and nurses.
GSK has rejected claims it is exploiting the pandemic, saying its development costs have been huge - up to £1.5bn over recent years according to some reports, including £1bn to ensure its factories can crank up vaccine production once the trials, due to start soon, are concluded. "No-one can say we aren't ready," said chief executive Andrew Witty yesterday.
Witty also stressed that GSK would be donating 50m doses of the vaccine for use by poorer nations. However, this gesture has caused a split among the drug-makers - some of whom believe giving vaccine doses away is neither sustainable nor cost-effective.
As a result, Novartis increased its our capacity dramatically. "But what we saw in the first years was that what was ordered and distributed was much, much lower than what was asked for and what was produced," said Oswald. "So we had big write-offs to make at the beginning. In a pandemic situation, taking a vaccine to developing countries is something we need to understand better."
Oswald said Novartis would consider reducing the price of the vaccine for poor countries, but giving it away for free was not an option. Claiming to have spent $2bn on research and development, he said: "With the flu situation, we have made a loss every year for the last three years. It has not been profitable; there is no 'wealth' we could donate and redistribute.
"The message we are sending out is not a message to the poor countries that can¹t afford it, but a message to our partners to expand flu production capacity in a sustainable way so that maybe one day we will be able to vaccinate everybody on the planet if a pandemic were to happen."
Writing last month in the Financial Times, business commentator John Gapper supported this line of thinking. He also said that "one-off gifts of childhood vaccines can cause more harm than good. Developing countries obtain far greater benefits from being offered guaranteed low prices for a vaccine over several years, enabling them to plan vaccination properly." ·
